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1. Company Snapshot

1.a. Company Description

Adecoagro S.A. operates as an agro-industrial company in South America.It engages in farming crops and other agricultural products, dairy operations, and land transformation activities, as well as sugar, ethanol, and energy production activities.The company is involved in the planting, harvesting, and sale of grains and oilseeds, as well as wheat, corn, soybeans, peanuts, cotton, sunflowers, and others; provision of grain warehousing/conditioning, handling, and drying services to third parties; and purchase and sale of crops produced by third parties.


It also plants, harvests, processes, and markets rice; and produces and sells raw milk, UHT, cheese, powder milk, and others.In addition, the company engages in the cultivating, processing, and transforming of sugarcane into ethanol and sugar; and the sale of electricity cogenerated at its sugar and ethanol mills to the grid.Further, it is involved in the identification and acquisition of underdeveloped and undermanaged farmland, and the realization of value through the strategic disposition of assets.


As of December 31, 2021, the company owned a total of 219,850 hectares of land, including 18 farms in Argentina, 8 farms in Brazil, and 1 farm in Uruguay, as well as a total of 241 megawatts of installed cogeneration capacity.Adecoagro S.A. was founded in 2002 and is based in Luxembourg, Luxembourg.

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1.b. Last Insights on AGRO

Adecoagro S.A.'s recent performance was negatively impacted by weak Q2 2025 earnings, with revenue and profit declines due to lower commodity prices and weaker crushing volumes. The company's dependence on volatile commodities and lack of rerating catalysts led to a downgrade to Sell. Adjusted EBITDA reached $55.4 million in Q2 2025, as the company leveraged its production and commercial flexibility to mitigate lower global prices. A cash dividend distribution of $17.5 million was announced, with a dividend per share of $0.17485.

1.c. Company Highlights

2. Adecoagro's Q3 2025 Earnings: A Mixed Bag

Adecoagro's financial performance in Q3 2025 was marked by a decline in gross sales to $323 million, a 29% year-over-year decrease due to lower volumes and prices across operations. However, adjusted EBITDA improved to $115 million, driven by stronger results from the Sugar, Ethanol and Energy business. The company's EPS came in at $0.26, significantly beating estimates of $0.05982. The Sugar, Ethanol and Energy business achieved a new quarterly crushing record of 4.9 million tons, with adjusted EBITDA rising 20% year-over-year to $120 million.

Publication Date: Nov -24

📋 Highlights
  • Adjusted EBITDA Q3 2025:: Consolidated adjusted EBITDA reached $115 million, with year-to-date total of $206 million.
  • Sugar, Ethanol & Energy Performance:: Achieved a quarterly crushing record of 4.9M tons and 40% higher ethanol production YoY.
  • Farming Business Decline:: Total production dropped 13% YoY due to adverse price-cost conditions, despite record dairy productivity.
  • Net Debt Increase:: Rose to $872 million, driven by lower results and a $96 million advance payment for the Profertil acquisition.
  • Cost Reduction Targets:: Anticipates 15–20% cost cuts in Sugar, Ethanol & Energy by 2026 through efficiency gains and lower raw material costs.

Segment Performance

The Farming business faced challenges, with a 13% year-over-year decline in total production due to unfavorable price-cost dynamics. Adjusted EBITDA for this segment was $1 million. However, the business is undergoing adjustments, including a 30% reduction in leased area and a shift in crop mix to improve margins. As Mariano Bosch noted, "We are adjusting our strategy to maximize margins per hectare."

Outlook and Guidance

Adecoagro expects a 5% to 6% increase in crushing volume for 2026, driven by higher sugarcane yields and availability, and a 15% to 20% reduction in costs due to efficiencies gained in agriculture and industrial operations. The company is also revising its capital expenditures to reduce costs and maximize synergies, with a focus on reducing leverage through cost savings and revising its capital allocation strategy. With a current EV/EBITDA ratio of 14.09 and a P/E ratio of 163.37, the market is pricing in significant growth expectations.

Debt and Capital Allocation

Adecoagro's net debt increased to $872 million, partly due to a $96 million advance payment for the Profertil acquisition. The company is taking steps to reduce its net leverage ratio, including cost-saving initiatives and revising its capital allocation strategy. The recent opportunity to take on additional debt is expected to contribute to results in the coming years. With a Net Debt / EBITDA ratio of 3.51, the company's debt levels are a concern, but the expected reduction in leverage and the potential accretion from the Profertil acquisition are positive factors.

Valuation and Conclusion

3. NewsRoom

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ADECOAGRO S.A. ANNOUNCES FILING OF SHELF REGISTRATION STATEMENT

Dec -01

Source: prnewswire.com

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Adecoagro Announces Submission of Binding Offer to Acquire the Remaining 50% of Profertil S.A.

Dec -01

Source: prnewswire.com

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Adecoagro: Farming Powerhouse With A Crypto Giant Shareholder Taking Big Steps For Expansion

Nov -20

Source: seekingalpha.com

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Adecoagro S.A. (AGRO) Q3 2025 Earnings Call Transcript

Nov -12

Source: seekingalpha.com

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Adecoagro S.A.:Adjusted EBITDA reached $115.1 million in 3Q25.

Nov -11

Source: prnewswire.com

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Adecoagro (AGRO) Sees a More Significant Dip Than Broader Market: Some Facts to Know

Nov -05

Source: zacks.com

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Adecoagro announces declaration of cash dividends

Oct -23

Source: prnewswire.com

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Adecoagro (AGRO) Exceeds Market Returns: Some Facts to Consider

Oct -13

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (9.96%)

6. Segments

Sugar, Ethanol and Energy

Expected Growth: 10.5%

Adecoagro's diversified portfolio of sugar, ethanol, and energy products drives growth, fueled by increasing global demand for renewable energy and sustainable agricultural practices.

Farming

Expected Growth: 10.5%

Adecoagro's focus on sustainable and responsible practices, increasing demand for organic and eco-friendly products, and expansion into new markets drive growth. Additionally, the company's diversified portfolio of crops and livestock, as well as its strong presence in South America, contribute to its growth potential.

Reconciling Items

Expected Growth: 4.5%

Adecoagro S.A.'s reconciling items are driven by factors such as changes in accounting estimates, differences in valuation methods, and adjustments for non-recurring items. The company's growth is expected to be fueled by increasing agricultural commodity prices, expansion into new markets, and investments in technology and sustainability initiatives.

7. Detailed Products

Farm Products

Adecoagro S.A. produces and sells a variety of farm products, including soybeans, corn, wheat, and sugarcane, among others.

Rice

Adecoagro S.A. produces and sells rice, a staple food crop, to local and international markets.

Sugar and Ethanol

Adecoagro S.A. produces and sells sugar and ethanol, a biofuel, from sugarcane crops.

Cattle

Adecoagro S.A. raises and sells cattle for beef production, as well as provides cattle fattening services.

Urea Fertilizer

Adecoagro S.A. produces and sells urea fertilizer, a nitrogen-based fertilizer, for agricultural use.

Land Transformation Services

Adecoagro S.A. provides land transformation services, including land acquisition, development, and management.

8. Adecoagro S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Adecoagro S.A. operates in the agricultural industry, where substitutes are limited. However, the company faces some threat from alternative crops and farming practices.

Bargaining Power Of Customers

Adecoagro S.A. has a diverse customer base, which reduces the bargaining power of individual customers. Additionally, the company's products are essential to its customers, making it difficult for them to negotiate prices.

Bargaining Power Of Suppliers

Adecoagro S.A. relies on suppliers for inputs such as seeds, fertilizers, and equipment. While the company has some bargaining power due to its size, suppliers can still exert some pressure on prices and delivery terms.

Threat Of New Entrants

The agricultural industry has high barriers to entry, including significant capital requirements and regulatory hurdles. This makes it difficult for new entrants to compete with established players like Adecoagro S.A.

Intensity Of Rivalry

The agricultural industry is highly competitive, with many players competing for market share. Adecoagro S.A. faces intense rivalry from other agricultural companies, which can lead to pricing pressure and reduced margins.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 43.80%
Debt Cost 7.57%
Equity Weight 56.20%
Equity Cost 9.52%
WACC 8.66%
Leverage 77.93%

11. Quality Control: Adecoagro S.A. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
M.P. Evans

A-Score: 7.5/10

Value: 6.6

Growth: 8.0

Quality: 8.1

Yield: 6.2

Momentum: 9.5

Volatility: 6.7

1-Year Total Return ->

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Stock-Card
ForFarmers

A-Score: 7.0/10

Value: 9.2

Growth: 4.6

Quality: 5.1

Yield: 8.1

Momentum: 8.5

Volatility: 6.3

1-Year Total Return ->

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Stock-Card
Anglo-Eastern Plantations

A-Score: 6.8/10

Value: 7.9

Growth: 5.2

Quality: 7.5

Yield: 5.0

Momentum: 10.0

Volatility: 5.0

1-Year Total Return ->

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Stock-Card
Sipef

A-Score: 6.8/10

Value: 6.7

Growth: 5.1

Quality: 7.2

Yield: 3.1

Momentum: 9.0

Volatility: 9.3

1-Year Total Return ->

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Stock-Card
Austevoll Seafood

A-Score: 5.6/10

Value: 6.2

Growth: 5.1

Quality: 3.0

Yield: 7.5

Momentum: 4.0

Volatility: 7.7

1-Year Total Return ->

View Full Report
Stock-Card
Adecoagro

A-Score: 3.9/10

Value: 1.9

Growth: 6.9

Quality: 2.6

Yield: 6.9

Momentum: 1.0

Volatility: 4.0

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

8.43$

Current Price

8.43$

Potential

-0.00%

Expected Cash-Flows